Critical Analysis: Republic Services (NYSE:RSG) & Securitas AB (publ) (OTCMKTS:SCTBF)

Republic Services (NYSE:RSG) and Securitas AB (publ) (OTCMKTS:SCTBF) are both industrials companies, but which is the better investment? We will compare the two businesses based on the strength of their profitability, earnings, institutional ownership, dividends, analyst recommendations, valuation and risk.

Insider and Institutional Ownership

57.7% of Republic Services shares are held by institutional investors. Comparatively, 35.4% of Securitas AB (publ) shares are held by institutional investors. 0.1% of Republic Services shares are held by insiders. Strong institutional ownership is an indication that hedge funds, endowments and large money managers believe a stock will outperform the market over the long term.

Profitability

This table compares Republic Services and Securitas AB (publ)’s net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
Republic Services	12.94%	18.69%	6.49%
Securitas AB (publ)	N/A	N/A	N/A

Valuation and Earnings

This table compares Republic Services and Securitas AB (publ)”s gross revenue, earnings per share (EPS) and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
Republic Services	$16.59 billion	4.05	$2.14 billion	$7.06	31.05
Securitas AB (publ)	N/A	N/A	N/A	N/A	N/A

Republic Services has higher revenue and earnings than Securitas AB (publ).

Analyst Ratings

This is a summary of current recommendations and price targets for Republic Services and Securitas AB (publ), as reported by MarketBeat.com.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
Republic Services	0	11	11	0	2.50
Securitas AB (publ)	0	0	0	0	0.00

Republic Services currently has a consensus target price of $245.26, indicating a potential upside of 11.90%. Given Republic Services’ stronger consensus rating and higher possible upside, analysts clearly believe Republic Services is more favorable than Securitas AB (publ).

Summary

Republic Services beats Securitas AB (publ) on 9 of the 9 factors compared between the two stocks.

About Republic Services

Republic Services, Inc., together with its subsidiaries, offers environmental services in the United States and Canada. It is involved in the collection and processing of recyclable, solid waste, and industrial waste materials; transportation and disposal of non-hazardous and hazardous waste streams; and other environmental solutions. Its residential collection services include curbside collection of material for transport to transfer stations, landfills, recycling centers, and organics processing facilities; supply of recycling and waste containers; and renting of compactors. The company also engages in the processing and sale of old corrugated containers, old newsprint, aluminum, glass, and other materials; and provision of landfill services. It serves small-container, large-container, and residential customers. The company was incorporated in 1996 and is based in Phoenix, Arizona.

About Securitas AB (publ)

Securitas AB (publ) provides security services in North America, Europe, Latin America, Africa, the Middle East, Asia, and Australia. The company operates through three segments: Securitas North America, Securitas Europe, and Securitas Ibero-America. It offers on-site guarding, mobile patrol, canine security, reception, loss prevention, screening, and track and trace services, as well as operates Securitas operation centers. The company also provides remote video solutions; aviation security services, such as physical security, airline security, hospitality, and consultancy related services; and electronic security services. In addition, it offers fire and safety; enterprise risk management services, such as risk and security management, executive protection, corporate investigations, and due diligence services; and intelligent security and home alarm services. The company was founded in 1934 and is headquartered in Stockholm, Sweden.